Investment firm Mohari Hospitality will acquire Tao Group Hospitality from Madison Garden Entertainment Corp. and other partners.
The deal values Tao Group at $550 million and will add restaurants, nightlife and entertainment venues to Mohari’s portfolio of luxury lifestyle and hospitality properties, according to the news release. Mohari will also gain a platform and management team to speed along its plans for growth. The deal is expected to close in May subject to customary closing conditions.
MSG Entertainment expects to receive net cash proceeds of approximately $300 million upon completion of the sale of its majority interest, according to a separate news release. MSG Entertainment acquired its majority interest in Tao Group in 2017. In fiscal year 2022, Tao Group generated approximately $485 million in revenue, $37 million in operating income and $67 million in adjusted operating income.
As part of the deal, Tao Group will enter into a multi-year agreement with MSG Entertainment for consulting, marketing and support services at Madison Square Garden and Sphere in Las Vegas.
"Tao Group has grown from an innovator in nightlife to a leader in premium lifestyle and hospitality,” said J. Allen Smith, managing partner at Mohari. “Its global footprint of more than 80 branded locations in over 20 markets and best-in-class management infrastructure speaks to the group's tremendous potential."
Mohari’s existing portfolio includes luxury and lifestyle properties and operating companies such as the Peninsula Papagayo in Costa Rica, anchored by a Four Seasons luxury resort; Centro Canalejas Madrid, featuring the Four Seasons Madrid; and The Ritz-Carlton Yacht Collection. Its leadership team includes investor and founder Mark Scheinberg and Smith, the former president and CEO of Four Seasons Hotels and Resorts.
Tao Group’s portfolio includes a global collection of brands including TAO, Hakkasan, Omnia, Marquee, Lavo, Beauty & Essex and more. Mohari will use its real estate development and hospitality management experience for future projects, including the recently announced Tao Hotel in Orlando, Florida.